Diffusion of Innovation - The Adoption of Electronic Commerce by Small and Medium Enterprises (SMES)- A Comparative Analysis

Abstract

This paper explores the issues that influence the diffusion of innovation as it relates to the adoption of e-commerce by Small and Medium Enterprises (SMEs). It seeks to identify factors facilitating and inhibiting such adoption across contexts – regional, small city and large city. This analysis is cross cultural so the impact of differing economic and cultural issues also will be identified in this research. Whilst it is generally accepted that the strategic use of information technology (IT) is vital in the marketplace, the rate of such uptake between small and large businesses varies. This research seeks to identify the reasons for this variation. It is critical to understand such factors so that steps can be taken to redress inequity of uptake that might be identified. The paper endeavours to explore factors that are needed to facilitate and encourage IT adoption and so positively influence user acceptance and use of IT innovations in SMEs. Reasons for such uptake as well as strategic approach to the adoption of e-commerce, and variations regarding same also will be considered. The paper examines existing theory as it pertains to the diffusion of innovation acknowledging the perspective of regional and urban SMEs in various cultural contexts. Empirical investigation exploring this diffusion, the rate of and approach to the uptake by SMEs is planned using a case study methodology